An interesting report from Jupiter Research on search finds, Vertical search is industry developing in much the same way as the media markets before it. The report finds that Paid search spending in the U.S. is highly concentrated. Just four categories - retail, financial services, media and entertainment and travel - accounted for 79% of the $2.6 billion spent on paid search in 2004. Each vertical provides a rich landscape of opportunity and a blueprint for how other categories will develop.In the search market overall, rapidly rising keyword prices on broad-based search engines will soon stabilize and industry growth will depend substantially on the incremental value provided by vertical search engines.
My Take: I think that the analog of television news channel evolution to major search engines is correct- the internet world shall also follow the rule of three eventually – the rule of three broadly says that in any industry there shall be three all purpose main players followed by several niche players. I am not sure whether to call niche search engines( I strongly beleive that they have a role and a future) them horizontals as Tom Evslin would like to call as or Fred calls as verticals and originally supported by Searchviews.
But increasingly,I see myself beginning to use niche search engines more and more(though all niche search engine usage put together could be substantially less than any one general search engine usage). For example services with discovery mechanisms powered by specialized algorithms like Findory or Topix shall always find a special place in the internet world where the volume of digital content is swelling by the day.The view expressed in searchviews that"As advertising spending continues to swell in the search category, more and more marketers will diversify their "network" buys with small targeted placements on these specialized engines that potentially provide a better bang for the advertising buck".But the overall volume of business could be low but can provide with some significant stream of business. But Niche players need to provide more and more specialised offering and creating a new category of service that mainstream players may not be able to focus and provide - like Amex offering more than what traditional banks can offer -traveller's cheque convenience.
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